UPSC Prelims Practice Questions — Government Strengthens Domestic Fertilizer Production and Supply Chain to Ensure Fertilizer Security

Question 1

Consider the following statements regarding India's fertilizer subsidy architecture:
1. Under the Nutrient Based Subsidy (NBS) scheme, the subsidy on P&K fertilizers is fixed on a per-nutrient basis (N, P, K, S).
2. Under the NBS scheme, the P&K sector is decontrolled and companies fix the MRP at reasonable levels, monitored by the Government.
3. Urea is sold to farmers at a statutorily notified uniform MRP fixed by the Government.
4. Under the NBS scheme, the Government statutorily fixes the MRP of P&K fertilizers.
Which of the statements given above is/are NOT correct?

Accepted Answer

4 only

Answer

1 and 3

Answer

2 and 4

Answer

3 and 4

Question 2

The fixation of Nutrient Based Subsidy (NBS) rates and the statutory Maximum Retail Price of urea are administered by which one of the following?

Accepted Answer

Department of Fertilizers, under the Ministry of Chemicals and Fertilizers

Answer

Department of Agriculture and Farmers Welfare, under the Ministry of Agriculture and Farmers Welfare

Answer

Department of Food and Public Distribution, under the Ministry of Consumer Affairs, Food and Public Distribution

Answer

Department of Chemicals and Petrochemicals, under the Ministry of Chemicals and Fertilizers

Question 3

In the context of India's urea sector, the New Investment Policy (NIP-2012) is best described as a policy that:

Accepted Answer

provides an assured price/return framework to incentivise fresh investment in new urea manufacturing capacity

Answer

fixes the per-nutrient subsidy for phosphatic and potassic fertilizers to promote balanced fertilization

Answer

mandates 100% neem coating of subsidized urea produced by domestic manufacturers

Answer

governs the statutorily notified Maximum Retail Price of urea at Rs.242 per 45 kg bag

Question 4

Consider the following matches of the new urea units set up under NIP-2012 with their locations:
1. Ramagundam unit (RFCL) — Telangana
2. Sindri unit (HURL) — Jharkhand
3. Panagarh unit (Matix Fertilizers) — West Bengal
4. Gadepan-III unit (Chambal Fertilizers) — Uttar Pradesh
Which of the above is/are NOT correctly matched?

Accepted Answer

4 only

Answer

1 and 2

Answer

3 only

Answer

2 and 4

Question 5

Consider the following statements about the mandatory neem coating of urea:
1. Neem coating slows the release of nitrogen from urea, improving Nitrogen Use Efficiency.
2. Neem-coated urea reduces the diversion of subsidized urea to non-agricultural and industrial uses.
3. Since 2015, 100% of indigenously produced subsidized urea is required to be neem-coated.
4. Neem coating of urea has completely eliminated India's need to import any nitrogenous fertilizer.
Which of the statements given above is/are NOT correct?

Accepted Answer

4 only

Answer

1 only

Answer

3 and 4

Answer

2 and 4

Question 6

The mandate making it compulsory for all indigenous producers to neem-coat 100% of their subsidized urea was notified by which one of the following?

Accepted Answer

Department of Fertilizers, under the Ministry of Chemicals and Fertilizers

Answer

Central Insecticides Board and Registration Committee, under the Ministry of Agriculture and Farmers Welfare

Answer

Department of Agriculture and Farmers Welfare, under the Ministry of Agriculture and Farmers Welfare

Answer

Fertiliser Industry Coordination Committee, under the Ministry of Consumer Affairs

Question 7

Consider the following statements comparing India's urea sector across reference points:
1. Indigenous urea capacity rose from 207.54 LMTPA in 2014-15 to about 269.42 LMTPA by 2026-27.
2. Urea production rose from about 225 LMT in 2014-15 to a record 314.07 LMT in 2023-24.
3. The New Urea Policy (NUP-2015), notified in May 2015, applied to newly constructed gas-based urea units.
Which of the statements given above is/are correct?

Accepted Answer

1 and 2 only

Answer

2 and 3 only

Answer

1 and 3 only

Answer

1, 2 and 3

Question 8

Consider the following statements about the timing of India's fertilizer policy milestones:
1. The statutory MRP of urea at Rs.242 per 45 kg bag has remained unchanged since 2018.
2. The Nutrient Based Subsidy (NBS) policy for P&K fertilizers came into effect in 2010.
3. India achieved its record urea production of 314.07 LMT in the year 2023-24.
4. The New Investment Policy (NIP) incentivising fresh urea manufacturing capacity was notified in 2015.
Which of the above is/are correctly identified?

Accepted Answer

1, 2 and 3

Answer

1 and 2 only

Answer

1, 3 and 4

Answer

2, 3 and 4

Question 9

With reference to the countries from which India arranged urea supplies to strengthen its supply chain in 2026, consider the following:
1. Oman
2. Malaysia
3. Brazil
4. Nigeria
Which of the above have been correctly identified as sources of urea supply to India in 2026?

Accepted Answer

1, 2 and 4

Answer

1 and 3

Answer

2, 3 and 4

Answer

1, 2, 3 and 4

Question 10

In the Cabinet approval of NBS rates for Kharif 2026, which one of the following is the flagship phosphatic grade specifically named as receiving subsidy alongside the NPKS grades?

Accepted Answer

Di-Ammonium Phosphate (DAP)

Answer

Muriate of Potash (MOP)

Answer

Single Super Phosphate (SSP)

Answer

Ammonium Sulphate

Question 11

Consider the following statements about the 'DBT in Fertilizers' mechanism:
1. 100% subsidy is released to fertilizer companies on the basis of actual sales to beneficiaries.
2. Sales are made through Point of Sale (PoS) devices installed at each retailer shop with Aadhaar authentication.
3. Fertilizer is sold on a 'no-denial basis' as there is no pre-defined beneficiary.
4. The subsidy amount is transferred directly into the bank accounts of individual farmers.
Which of the above is/are correctly identified?

Accepted Answer

1, 2 and 3

Answer

2 and 4

Answer

1 and 4

Answer

1, 2, 3 and 4

Question 12

Consider the following statements about India's dependence on fertilizers and their raw materials:
1. India imports the entire (100%) requirement of its Muriate of Potash (MOP).
2. India is about 90% dependent on imports for its phosphatic requirement.
3. Rock phosphate is the key raw material for DAP and NPK fertilizers.
4. India is fully self-sufficient in urea and imports none of its requirement.
Which of the above is/are correctly identified?

Accepted Answer

1, 2 and 3

Answer

1, 3 and 4

Answer

2 and 4

Answer

1, 2, 3 and 4

UPSC Prelims Practice Questions — Government Strengthens Domestic Fertilizer Production and Supply Chain to Ensure Fertilizer Security

Q2. The fixation of Nutrient Based Subsidy (NBS) rates and the statutory Maximum Retail Price of urea are administered by which one of the following?

Q3. In the context of India's urea sector, the New Investment Policy (NIP-2012) is best described as a policy that:

Q6. The mandate making it compulsory for all indigenous producers to neem-coat 100% of their subsidized urea was notified by which one of the following?

Q9. With reference to the countries from which India arranged urea supplies to strengthen its supply chain in 2026, consider the following: 1. Oman 2. Malaysia 3. Brazil 4. Nigeria Which of the above have been correctly identified as sources of urea supply to India in 2026?

Q10. In the Cabinet approval of NBS rates for Kharif 2026, which one of the following is the flagship phosphatic grade specifically named as receiving subsidy alongside the NPKS grades?